MAY 2020

Crisis from Kolkata to Kabul: COVID-19’s Impact on South Asia

BY AMBASSADOR HUSAIN HAQQANI DIRECTOR FOR SOUTH AND CENTRAL ASIA, HUDSON INSTITUTE

DR. APARNA PANDE DIRECTOR, INITIATIVE ON THE FUTURE OF INDIA AND SOUTH ASIA, HUDSON INSTITUTE © 2020 Hudson Institute, Inc. All rights reserved.

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Cover: An Indian volunteer wearing a protective mask and face shield stands guard on a road, as India remains under an extended lockdown due to COVID-19 on May 6, 2020 in New Delhi, India. (Photo by Yawar Nazir/Getty Images) MAY 2020

Crisis from Kolkata to Kabul: COVID-19’s Impact on South Asia

BY AMBASSADOR HUSAIN HAQQANI DIRECTOR FOR SOUTH AND CENTRAL ASIA, HUDSON INSTITUTE

DR. APARNA PANDE DIRECTOR, INITIATIVE ON THE FUTURE OF INDIA AND SOUTH ASIA, HUDSON INSTITUTE AUTHOR

Ambassador Husain Haqqani Dr. Aparna Pande Ambassador Husain Haqqani is a senior fellow and director Aparna Pande is a research fellow and the director of Hudson for South and Central Asia at Hudson Institute. He served as Institute’s Initiative on the Future of India and South Asia. She Pakistan’s ambassador to the United States from 2008 to 2011 wrote her PhD dissertation on Pakistan’s foreign policy. Her and is widely credited with managing a difficult partnership major field of interest is South Asia with a special focus on India, during a critical phase in the global war on terrorism. Amb. Pakistan, Afghanistan, Foreign and Security Policy. Haqqani’s distinguished career in government includes serving as an advisor to four Pakistani Prime Ministers: Yusuf Raza Dr. Pande is the author of Explaining Pakistan’s Foreign Policy: Gilani, Benazir Bhutto, Nawaz Sharif, and Ghulam Mustafa Escaping India (Routledge, 2011), From Chanakya to Modi: Jatoi. He also served as Pakistan’s ambassador to Sri Lanka Evolution of India’s Foreign Policy (Harper Collins India, 2017) from 1992 to 1993. and edited Routledge Handbook of Contemporary Pakistan (Routledge, 2017). Amb. Haqqani is the author of four books: Pakistan Between Mosque and Military (Carnegie, 2005), Magnificent A 1993 graduate of Delhi University, Aparna holds a Master of Delusions: Pakistan, the United States and an Epic History of Arts in History from St. Stephens College at Delhi University and Misunderstanding (Public Affairs, 2013), India vs Pakistan: Why a Master of Philosophy in International Relations from Jawaharlal Can’t We Just Be Friends? (Juggernaut, 2016) and Reimagining Nehru University. Aparna Pande received a Doctorate in Political Pakistan: Transforming a Dysfunctional Nuclear State (Harper Science from Boston University in 2010. Collins, 2018). He is also the co-editor of Hudson’s journal, Current Trends in Islamist Ideology.

Amb. Haqqani was formerly director of the Center of International Relations, and a professor of the practice of international relations at Boston University. Amb. Haqqani received his bachelor’s and master’s degrees in international relations from the University of Karachi. TABLE OF CONTENTS

Introduction 6

India 9

Pakistan 14

Afghanistan 17

Bangladesh 20

Nepal 23

Sri Lanka 26

Conclusion 29

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA INTRODUCTION

The world’s most populous region, South Asia, with almost It may be that India, Pakistan, and other countries in South Asia 1.9 billion people living in eight countries, has so far had have a low number of confirmed cases because the region is fewer reported infections and fatalities per capita from the behind on testing, tracing, and isolating. Although inadequate novel coronavirus than projected in early models. However, testing is a problem in other parts of the world, too, it serves as the region is unlikely to escape the widespread disruption and an excuse for South Asia’s governments to keep the publicly damage felt across the globe, and its worst health-care crisis stated numbers in check. may be yet to come. Governments share figures only for those who have been In South Asia, as in other regions, the COVID-19 pandemic is tested or otherwise accounted for in woefully ill-equipped testing the capacities of states to provide security and effective healthcare and to maintain essential services. It is also having Photo Caption: Medical staff light candles for World Nurses Day at an impact on fragile democratic institutions and societal bonds, the Sawai Man Singh Hospital during India’s nation-wide lockdown in in addition to putting considerable strains on the economy. Jaipur on May 12, 2020. (Vishal Bhatnagar/NurPhoto via Getty Images)

6 | HUDSON INSTITUTE public-health systems. There may be other patients who are the future. India could emerge ahead in the contest with China not being counted, inadvertently or in some cases, deliberately. with the right mix of policies. Government-mandated lockdowns, first introduced in Bangladesh and India and subsequently adopted across South India has opted for a regional response to the COVID-19 crisis Asia, have been somewhat successful, but the extent of the and offered technical assistance and medical equipment to region’s exposure to COVID-19 is still not fully known. its neighbors, some of whom remain wary of China. Beijing’s lack of transparency at the outset, when the coronavirus first India and its neighbors have many people under the poverty appeared in Wuhan, is also unlikely to enhance confidence in line, insufficient investment in social capital, especially Chinese leadership. China would still have the advantage of its healthcare, and large migrant labor forces. Even if the numbers larger foreign currency reserves and the ability to offer loans and of fatalities and confirmed cases remains low, the International investment. This can be mitigated through closer collaboration Monetary Fund (IMF) has predicted that the pandemic will have between India, the United States, and other democracies. a devastating impact on South Asia’s economies. The country worst hit by COVID-19 in South Asia is China’s The IMF projects that India’s economy, which until recently was most dependable ally, Pakistan, the second-largest country in expected to contribute to global growth, will experience further the region. A fragile state with a large military, a strong jihadi slowdown.1 According to the IMF, Nepal, one of the smaller terrorist presence, and nuclear weapons capability, Pakistan’s South Asian economies, will become the fastest-growing many fault lines are likely to be exacerbated by the pandemic economy in the region with 2.5 percent growth, followed by and the economic downturn in its aftermath. The slow and Bangladesh with 2 percent, then India with 1.9 percent. fumbling response of Pakistan’s civilian government has already positioned the military to step in and take charge once again, Sri Lanka is expected to have negative growth, with its economy diminishing Pakistan’s civilian democratic facade. This will only shrinking by half a percent. Pakistan is likely to be the worst hit, strengthen China’s grip on Islamabad. with negative economic growth of 1.5 percent. Pakistan’s response to the coronavirus resembles that of India, the largest country in the region, would ideally be suited Sri Lanka, another country heavily indebted to China. Both to playing a major role in rebuilding its neighborhood because Pakistan and Sri Lanka focused their early comments on of its central location and large economy. It would be in the praising Beijing. Pakistan even helped Chinese propaganda by U.S. interest to encourage this outcome. India, however, would spreading conspiracy theories claiming that the virus originated simultaneously be dealing with a slowing economy, rising with British or US biological warfare preparations. social tensions, divisive politics, and insufficient investment in healthcare. Although Pakistan’s precarious economic situation has led it to seek assistance from the IMF, it will likely not take long for it There is a geopolitical reason, too, for the United States and to turn to China for help, just as Sri Lanka has done. Western other democracies to encourage Indian regional leadership in governments could continue to try to aid Pakistan, hoping to post-pandemic rehabilitation. China has been expanding its keep it out of China’s stranglehold, but that would be the pursuit influence in South Asia and could step in more aggressively to of sunk cost. Pakistan’s embrace of China is already tight; its assist weakened governments with a view to controlling them in military leadership’s antipathy to India is unlikely to help reorient

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA Islamabad towards the West any time soon. Indian and Pakistani what its generals see as permanent conflict with India. In the troops have exchanged fire along the Line of Control (LOC) in aftermath of the ravages of the coronavirus, China-Pakistan Kashmir, following intelligence reports that Pakistan might be relations can be expected to remain close, setting the stage increasing terrorist infiltration into Indian-controlled territory. for a new round of competition between China and India for regional pre-eminence. That Pakistan might try to use the COVID-19 emergency to expand subconventional war against India, or that India Following is a country-by-country report, with inputs from experts believes it would, reflects the depth of mistrust between the two on the ground, on the coronavirus pandemic’s impact in South neighbors. Pakistan relies on its close ties to China to pursue Asia and its human, economic, and political consequences.

8 | HUDSON INSTITUTE INDIA

According to the Indian Council of Medical Research, as of May or for catering to millions of infected patients. Indian experts 21, 2020, India had tested 2,615,920 COVID-19 samples.2 admit that it might be more difficult for the country to ramp At that time, there were 112,000 confirmed cases and 3,435 up testing, trace contacts, isolate people, and neutralize the deaths.3 Given that the country’s population is around 1.4 spread of the virus. According to Manoj Joshi, distinguished billion, India’s leaders have cited the numbers as evidence that fellow at the Observer Research Foundation, India “may be it is withstanding the challenge of the virus well. able to even do so in cities, but the poor countryside is likely to be triaged.”4 The government of Prime Minister Narendra Modi and his Bharatiya Janata Party (BJP), which returned to power with a In the first weeks of March, India evacuated and quarantined massive mandate in May 2019, made limited testing, combined many of its citizens returning from other countries. Its borders with strict quarantine of those with a travel history or symptoms, have been sealed since March 22, 2020, and movement across the centerpiece of their COVID-19 policy. A strict nation-wide the borders of India’s twenty-eight states and eight union lockdown, shutting all businesses and directing everyone to territories was banned. Prime Minister Modi had initially ordered stay at home, began on March 22, 2020. the lockdown to last until April 14, 2020, later extending it till

Officials expected the lockdown to quarantine most ofthe Photo Caption: Passengers of the first train arrive in Kolkata on May population and thus limit further community transmission. The 12, 2020, after the reopening of the Indian Railways network following drastic lockdown was considered India’s only option because the seven-week nationwide lockdown. (Indranil Aditya/NurPhoto via its health-care infrastructure is not set up for massive testing Getty Images)

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA May 17.5 Some easing of these restrictions have started with image of “the strong man India needs” and has been able to the country being divided into zones (red, orange and green), “mobilize the nation on emotional issues.”8 Thus, it is doubtful restarting of rail services from May 12, and intimation that by that a unified, nation-wide opposition to the prime minister June large segments of the country may open up. India has will emerge. also launched a massive repatriation exercise for its citizens, primarily stranded students and workers, being brought back That said, India’s abysmal investment in human capital through special flights and ships.6 development will continue to stymie the Modi government’s efforts to combat the pandemic. As states controlled by Managing the COVID-19 crisis well is politically important for Modi opposition parties try to outdo the federal government in and the BJP. Even after decisively winning federal parliamentary delivering services, governance will be further politicized. elections, the party has faced setbacks in several state elections. Unfortunately, the resulting political competition is unlikely to be Further, before the pandemic, the BJP faced major challenges a healthy one. from countrywide protests against the Citizenship Amendment Bill, an economic slowdown, and unrest resulting from what India’s healthcare is an area where mis-governance has critics see as majoritarian communalist policies. undermined the development of human capital. India spends only 1.28 percent of GDP on health, resulting in a shortage of The situation created by COVID-19 has exacerbated India’s trained doctors, primary health-care centers, and hospitals.9 economic downturn. It has also exposed the lack of capacity, This shortfall cannot be overcome in the midst of a pandemic, especially in healthcare, and shown that state governments, which is likely to test a weak infrastructure beyond its capacity. some controlled by parties other than the BJP, did better in dealing with the consequences of the pandemic. States not run Moreover, the lockdown has imposed a strain not just on India’s by the BJP have been more proactive since the beginning of health-care system, but also on its transport infrastructure. India the virus outbreak. struggles to provide basic goods and services to its people under normal conditions. The effort to prevent the coronavirus Kerala, for example, applied its experience in dealing with Ebola from spreading by shutting down businesses and telling people and SARS. That—along with a health-care infrastructure that to stay at home is making the delivery of food, water, and is better than that of the other states, help from community essential services difficult. activists, and contact tracing—have helped Kerala keep COVID-19 under control. A large number of Indians living Economic and Social Ramifications abroad, especially in the Middle East, come from Kerala, which India’s economic growth, which reached a high of 7 percent is a coastal state. Without adequate measures, it might have in 2016, was wavering around 4.5 percent even before had a much larger number of cases among families of those COVID-19 struck. According to IMF projections, growth will fall returning from overseas.7 to 1.9 percent in 2020.10 Indian economist Rupa Subramanya, however, has warned against pinning hopes on the IMF’s French academic Christophe Jaffrelot has observed that even relatively positive predictions and believes the country should if opposition-ruled states can do a better job than the central be prepared for negative growth. According to Subramanya, government in dealing with the virus, this would not affect it would be more realistic to expect “a contraction of GDP and Modi’s standing. In his view, Modi has managed to retain the a surge in unemployment directly due to the prolonged and

10 | HUDSON INSTITUTE total lockdown.” She points out that Japanese investment The fear of a return to food poverty for millions has resulted in bank Nomura estimates that 70 percent of India’s economy is demands that the government use its extensive food stocks to currently frozen and expects that to result in “a big drop in GDP provide for all. There have been suggestions to set up public growth which may well go negative.”11 canteens for migrant labor and to send food to children and the most marginalized members of society. In a recent op-ed, According to Nitin Pai, head of the Takshashila Institution, India’s three of India’s top economists, Amartya Sen, Abhijit Banerjee, immediate challenge “is to provide relief to the affected people and Raghuram Rajan, argued for support to farmers and small and businesses, alongside an economic revival plan. The longer- businesses. “Farmers need money to buy seeds and fertilizer term challenge is economic reconstruction.” Pai adds that it for the next planting season; shopkeepers need to decide how is hard to form an objective opinion about the government’s they will fill their shelves again; many others have to worry how handling of the current crisis “because it’s unprecedented and they would repay the loan that is already due. There is no reason there are no benchmarks.”12 why, as a society, we should ignore these concerns.”15

Pai has joined critics of the World Health Organization (WHO), The ruling BJP appeared open to these suggestions. noting that “the world would perhaps have been better off Conventional Indian thinking and policymaking has often had WHO raised the alarm in late January or early February. accepted an enlarged role for government, and socialism Its overcautiousness in raising the alarm meant that the world’s remains a buzzword among India’s political circles, even on the governments didn’t get the urgency until mid-March. Why WHO right. However, government relief measures would also further did what it did is another matter, but I think we must recognize diminish the prospect of a deregulated Indian economy. The that fact.” BJP initiated discussions with economists and business leaders to revive the conversation on structural reforms that have been Several Indian scholars and public figures have criticized the on the agenda for the last two decades but have never been lack of government preparation before the announcement of a implemented. During these discussions, party leaders once complete lockdown. According to Joshi, “middle-class people again spoke of decreasing regulation and lowering the cost of were able to cope” with the suddenness of the lockdown, while doing business while maintaining financial support to the lower “migrant labor” was devastated. “Many of them have only informal strata of society. employment, with no unemployment benefits. The shutdown of the economy meant that hundreds of thousands of people were The countrywide total lockdown has affected every sector of the thrown out of jobs and are facing the prospect of slow starvation.” economy, including agriculture, manufacturing, and services. Experts were critical of the government’s initial economic Images on social media and television of thousands of poor package of $22 billion16 (1.7 trillion Indian rupees). As Manoj migrant workers and their families trying to walk across Joshi pointed out, it was only 0.8 percent of India’s GDP. By the country to their homes shocked the world, leading the comparison, the US and Singaporean relief packages amount government to create camps to house them temporarily.13 But to 10 percent of each country’s GDP. putting thousands of people in temporary camps might not be the right way to prevent the spread of COVID-19. As Subramanya Responding to both internal discussions and external critique, on notes, “The gains India made over decades in poverty alleviation May 12, 2020, Modi announced an all-encompassing economic may be wiped out in the coming weeks and months.”14 relief package of $264 billion (20 trillion Indian rupees), including

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA the initial package.17 The Prime Minister also intimated that Muslims—who number almost 200 million in India—weakens there would be reforms in the areas of land, labor, and capital. social cohesion and must be countered.22 One of these proposals is of giving tax exemptions for 10 years to companies that set up new factories in labor-intensive areas, Christophe Jaffrelot observes that social frictions only “amplify like textiles, food processing, leather and footwear.18 That labor trends which were already obvious before.”23 He points to the market reforms are being discussed was visible when on May spread of “ghettoization” and the extension of discrimination 8-9, three BJP-led states, Gujarat, Madhya Pradesh and Uttar against India’s minorities into hospitals and delivery of essential Pradesh, announced that all new manufacturing plants would services. In recent days, India has witnessed cases of hospitals be exempt from almost all exiting labor laws for a period of three segregating patients based on religion, which does not augur years.19 well for a multicultural India. If India is to attain its economic goals, it is important for it to maintain an integrated society. If these changes spread to other states, they could provide manufacturing with the requisite boost it needs and also External Relations help with employment and job creation. Many countries and India has traditionally responded to humanitarian disasters by investors want to move their manufacturing out of China. India, drawing closer to its neighbors and working together with its with a large labor force and proximity to China, could become international partners. This time, too, Delhi was quick to act and the venue for relocation. The Indian government hopes that a pushed for a regional response to the pandemic coordinated combination of geopolitics and internal economic policies will by SAARC (South Asian Association for Regional Cooperation). provide Indian industry with the necessary boost to access It also acted in concert with other nations, both bilaterally and foreign markets and obtain access to both foreign investment through the W.H.O. and foreign technology. India proposed setting up a SAARC COVID-19 fund and In addition to economic reforms, the government must also contributed $10 million to it.24 India has sent medical teams mend India’s social fabric. Over the last decade, but especially to Nepal and the Maldives to help them set up quarantine in the last five to six years, there has been a steady rise in facilities and to train their personnel.25 In recent weeks, it intolerance and communal majoritarianism within Indian has sent hydroxychloroquine to its neighbors and to other society. In February 2020, while President Trump was in India, countries, including the United States.26 The Indian Navy has one of the worst sectarian riots in decades hit the capital, New kept two ships on standby for immediate deployment to any Delhi. Muslim-neighborhoods were targeted by Hindu vigilante foreign country if there is a need to evacuate Indian personnel mobs, eliciting retaliation. Police did not react in time to protect or deliver emergency provisions. Retired Navy Admiral Shekhar the victims and dozens of people were killed. 20 Sinha, referred to India as “the first responder to humanitarian disasters” in the Indian Ocean region.27 Components of Indian society, including the media and many television channels, have used COVID-19 to portray the virus in Most experts agree that India’s pursuit of a regional response religious tones. After the Islamic fundamentalist group Tableeghi was the right choice, even though adversarial relations with Jamaat held a conference in Delhi and Pakistan in March, Delhi Pakistan have made cooperation difficult. At every SAARC became a key COVID-19 hotspot, leading critics to call this meeting about the coronavirus, Pakistan has insisted on talking a “corona jihad.”21 As Joshi points out, this demonization of about the dispute over Kashmir before other matters. According

12 | HUDSON INSTITUTE to Jayadeva Ranade, president of the Center for China Analysis South Asia that borders all its neighbors, but they do not border & Strategy, this is Delhi’s way of letting its neighbors know that each other. Joshi argues that this is an opportunity for India it is “willing to help” even when faced with pressing domestic to take the lead, using its resources, location, and technical demands on its limited resources.28 expertise and its experience from dealing with various disasters over the years. If it is able to do that, Joshi believes, this would Joshi, the Indian scholar, has noted that “humanitarian disasters “benefit the SAARC region as a whole and promote India’s don’t respect state boundaries.” India is the only country in security as well.”

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA PAKISTAN

With 48,091 confirmed cases as of May 21 and 1,017 deaths, It was only on March 23, 2020, that the government announced Pakistan faces the most serious threat from the coronavirus in several measures, quarantining more than three thousand South Asia.29 Pakistan has slightly less than half the number travelers from Iran, closing borders with neighboring countries, of cases as India, even though its population is one-sixth the and instituting international travel restrictions and social size. Suspicions persist about the credibility of official statistics, distancing measures.31 Some provincial governments had suggesting that Pakistan might have been harder hit by the already implemented lockdowns, like the southern province of pandemic than its officials admit. Sindh, which is ruled by the opposition Pakistan Peoples Party.

Prime Minister Imran Khan’s government, led by Pakistan The government’s measures faced resistance from religious Tehreek-e-Insaf, was not prepared to deal with this pandemic groups that oppose restrictions on religious observances and initially pretended there was nothing serious to worry about. and gatherings. This has led to serious consequences. After Pakistan did not evacuate its citizens (primarily students) from Wuhan, China, and flights and movement between Pakistan and Photo Caption: A volunteer disinfects a mosque as a preventive hotspots like China and Iran were kept open long after the rest measure against COVID-19 in Peshawar, Pakistan on April 1, 2020. of the world had suspended travel.30 (Saeed Ahmad/Xinhua via Getty)

14 | HUDSON INSTITUTE the Tablighi Jamaat conference, 20,000 attendees had to be also expects a decline in remittances from the Persian Gulf, and quarantined.32 Pakistan expert Mohammad Taqi warns that while Pakistani professionals in the United States and Europe “with the Muslim holy month of Ramadan starting at the end of might continue to send some money, the amounts will be April, dillydallying over the congregational prayers—suspended drastically reduced. In late March the government announced a in several Muslim countries and at Islam’s key holy sites— relief package of 1,200 billion Pakistani rupees ($5.5 billion) for could be a make-or-break moment for the country’s health- cash transfers to low-income families for the purchase of meat, care infrastructure.”33 But the government deferred to clerics, health supplies, and food, and even for electricity payment relief. creating the likelihood of further virus spread during Ramadan. 36 But relief package delivery was uneven in different parts of the country and was marred by corruption and political wrangling. Pakistan’s poor track record on human rights and protection of religious minorities worsened as the government used the cover The government’s relief package did little to deal with the of the coronavirus crisis to continue actions that are usually underlying weakness of the economy, including the potential condemned internationally. Author and human rights advocate for diminished exports and remittances and high indebtedness. Farahnaz Ispahani describes the government’s attempts “to Since 2018, loans from the IMF and from Saudi Arabia, the muzzle journalists and the partly independent press with the UAE, and Qatar have proven insufficient to boost Pakistan’s arrest of media owners, the shutting down of popular talk economy, burdened by years of heavy military spending and shows, and the policing of the internet.” Ispahani also notes debt servicing.37 Pakistan requested and obtained an IMF loan that cases of “discrimination against religious minorities have of $1.4 billion under a rapid financing instrument to tide it over been reported in distribution of food rations and even in medical until the COVID-19 situation improves.38 But further borrowing treatment.”34 without increased productivity will only aggravate Pakistan’s economic predicament. Already low tax collection is likely to fall Civilian rule and Pakistan’s partial democracy have also been even further now that taxpayers will have less income because casualties of the COVID-19 pandemic. From 2008, after the of the coronavirus lockdown. collapse of General Pervez Musharraf’s military regime, Pakistan appeared to be moving towards democracy. The military According to Uzair Younus, non-resident senior fellow at the remained powerful, but elected civilian governments tried to Atlantic Council, the current crisis is more serious than crises gradually assert their authority against the country’s military Pakistan has faced in the past, when the informal economy kept intelligence establishment until 2018. Over the last two years, the country afloat even during times of low growth. “COVID-19 under Prime Minister Khan, the country has slid towards being a has created a situation where both the formal and informal democracy in name only. The coronavirus crisis has eroded even economy have come to a complete halt,” Younus pointed out, the semblance of civilian control. Under Khan, the civil-military suggesting that the government might need to take care of the relationship had been good because he was the military’s poor and unemployed informal-sector workers.39 protégé. Now, however, the military is openly taking major decisions that constitutionally fall within the civilian domain. Pakistan, says Younus, needs to “execute a whole-of-country approach that seeks to push structural reforms, implement Pakistan’s economy, already in bad shape, is likely to worsen public development projects that can kick-start the economy, after the COVID-19 crisis. The IMF has projected a negative and create an enabling policy and political environment for growth rate for Pakistan of 1.5 percent in 2020.35 The country economic growth.” It is unlikely, however, that the country’s

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA fragmented polity and tradition of persistent military intervention Moreover, Pakistan had hoped to become the pre-eminent would allow Pakistan to implement any long-term plans even power in Afghanistan once the United States agreed to after the current crisis. withdraw its forces and paved the way for the Taliban’s return to power. But peace in Afghanistan remains elusive, In the realm of foreign policy too, Pakistan remains weak, having with the Taliban continuing to refuse a cease-fire during the put most of its eggs in China’s basket. Although India faces pandemic. international pushback over rising intolerance and its policies in Kashmir, there is little support for Pakistan’s stance against India. Pakistan’s response to COVID-19 appears to show that it is prioritizing its strategic relationship with China over caring for its Pakistan remains on the UN Financial Action Task Force (FATF) own people or addressing the spread of the virus. The country gray list of countries not fulfilling their obligations to cut off has also become a center for conspiracy theories that accuse terrorist financing. In October 2018, Pakistan’s terror watch the United States and the UK of “creating” the virus as part of list had 7,600 names. Over the past eighteen months it has biological warfare experiments. removed 3,800 of them, in order to claim that there are fewer terrorists in the country and make it easier to get off the gray Former Pakistani UN ambassador Hussain Haroon has put out list.40 The decision by a Pakistani court to release the killers a video explaining that the virus was created by the British and of Wall Street Journal reporter Daniel Pearl, murdered by al- the Americans and unleashed on the world.42 Zaid Hamid, a Qaeda in 2002, has kept the country in the news for its refusal pro-military jihadi propagandist, and several Pakistani television to take action against jihadi terrorists. According to defense anchors and social media personalities have advanced similar analyst Ayesha Siddiqa, the immediate decision to re-arrest conspiracy theories. Even after the pandemic ends, the effects all four meant that Islamabad wants to avoid “tough questions of this propaganda will linger, and Pakistan’s public will remain regarding the military’s continued links with militancy.”41 anti-Western and pro-China.

16 | HUDSON INSTITUTE AFGHANISTAN

As of May 21, 2020, there were 8,676 confirmed cases of The government’s response has included building a hospital COVID-19 in Afghanistan, with 193 deaths.43 According to the in Jalalabad, setting up screening procedures at borders and Afghan Ministry of Public Health, 90 percent of these cases are quarantine camps for refugees, opening labs in key cities (Kabul, tied to pilgrims and workers returning from Iran, where almost Herat, Jalalabad), and procuring supplies from abroad. The 100,000 Afghans work.44 The rest are Afghan refugees returning government also enhanced stay-at-home orders by adjusting home from Pakistan. the civil service work schedule, ordering social distancing, closing public places to gatherings, and postponing the launch The response of the Afghan government, like that of many of of a new school year. its neighbors, was slow and showed a lack of preparation. It also reflected Afghanistan’s unique situation, as it borders two It also cancelled Nowruz celebrations, while the Hajj and COVID-19 hotspots, Iran and Pakistan. The first lockdown in Religious Ministry called on people to pray at home and avoid Afghanistan was in Herat on March 25, 2020, and Kabul was next. There has been no countrywide lockdown, however, Photo Caption: Members of the Tawaan Foundation distribute face and until mid-March 2020, the government had not closed its masks, gloves and disinfectants to villagers in Jalalabad, Afghanistan external borders. on March 18, 2020. (Wali Sabawoon/NurPhoto via Getty Images)

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA holding mourning ceremonies at mosques. However, experts country, Afghanistan is dependent on its neighbors for trade, argue that these measures were too few and half-hearted. On remittances, and supplies. In the current situation, with March 25, 2020, the Health Ministry stated that in the worst borders closed and trade reduced because of COVID-19 case, 80 percent of Afghans—approximately 25 million people— and with the threat of decreased US assistance, the Afghan would contract the coronavirus and 110,000 would die. economy is confronting short- and long-term challenges. As Javid Ahmad, senior fellow at the Atlantic Council, notes, Herat, the province bordering Iran, was the epicenter, as “the outbreak brought to the fore the country’s continued thousands of Afghans returned daily from Iran. According to dependence on imported medical resources and equipment, Davood Moradian, head of the Afghan Institute for Strategic and most importantly, medicine. Every year, Afghanistan Studies, “provincial authorities lacked basic means and mandate imports an estimated $600 million worth of medicine, most to either slow down the return of Afghans from Iran, or to properly of which comes from the regional countries of Pakistan, India, scan them at the border areas. It is estimated approximately and Iran.”47 200,000 Afghans returned from Iran during February and March. Most of them arrived in Herat and then spread to the The Afghan government faces both internal and external rest of the county. The Afghan government failed to institute a challenges. During the COVID-19 pandemic, when foreign joint policy/framework with neighboring Iran to properly manage attention and assistance are focused elsewhere, Afghans the returnees.”45 Many Afghan refugees returning from Pakistan need national unity and a coherent government response. The were not properly scanned at the border either. Afghanistan also ongoing political impasse in the country has also hampered suffered because neither Iran nor Pakistan showed any interest the government’s response. Moradian referred specifically in testing or in limiting the spread of the virus. to “structural flaws in Afghanistan’s governance structure,” “Washington’s disregard for Afghanistan’s political and electoral Afghanistan has a weak health-care infrastructure, a legacy politics/calendar in favor of its “peace” deal with the Taliban” and of decades of war, including civil war. It also suffers from “entrenched corruption and manipulation within Afghanistan’s shortages of supplies and personnel. There are only twelve electoral bodies.”48 working ventilators in the entire country and not enough staff to operate them, and there are not enough doctors, hospitals Prakhar Sharma, an Afghanistan expert at the International beds, or health-care workers. According to Moradian, modelling Republican Institute, adds that the “viability” of the existing and predictions by Afghan health authorities indicate that an Afghan political setup will depend to a large extent “on how “uncontrolled outbreak of the COVID-19 pandemic would result credibly it shapes the narrative around its response.” Sharma in 700,000 cases of hospitalization; out of them circa 200,000 added, Kabul’s ability to fight the pandemic will depend both would need intensive care support. 110,000 Afghans would lose on its ability “to recruit the support of provincial governors and their lives to the virus.” 46 The country’s existing infrastructure district administrators” and “the level of cooperation it is able to can support only 5–10 percent of those numbers. garner from the population.”49

In an attempt to fight the pandemic, the government set aside Along with the coronavirus, Afghans also have to deal with war $25 million to cover immediate expenses, but according to and insurgency. Since the signing of the US-Taliban “peace the IMF, the country will need $2 billion. The Afghan economy deal” on February 29, 2020, there has been a three-fold rise in is dependent on external assistance. Further, as a landlocked Taliban attacks. “Afghan security is threatened by two formidable

18 | HUDSON INSTITUTE threats,” says Moradian, “the uncertainty of US/NATO support order commands reasonable coherence and order across the for Afghanistan’s constitutional order, particularly the National country” and there is “adequate financial and strategic support” Defense and Security Forces, and the outcome of the political to the Afghan security forces.51 Ahmad refers to the critical fact dispute in Kabul.” 50 He maintains, however, that the Taliban and that the “most salient and immediate security concerns have the anti-state forces lack the vision and the means to present a been the high attrition rates in the Afghan forces, including a strategic threat to the county. record number of casualties.” The current monthly attrition rate, according to Ahmad, is between 2.5 percent and 2.9 percent of Moradian maintains that Afghanistan’s security while fragile total Afghan forces, and that “has affected Afghan force posture will not be threatened as long as “the Afghan constitutional and combat motivation.”52

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA BANGLADESH

As of May 21, 2020, there were 28,511 confirmed cases in to build capacity, “recent reports indicate that it has only 1,267 Bangladesh and only 408 deaths.53 The government imposed ventilators for approximately 160 million people.”54 a countrywide lockdown, akin to India’s, on March 25, and has extended it till May. The government reacted like its This, along with the high population density of Bangladesh, only neighbors as the problems the country faces are similar: a large worsens the situation. Oldmixon, referring to the high population population, dependence on remittances from migrant laborers, density, Bangladesh has over 1,200 people per square and dependence on trade to keep the economy going. kilometer, compared to 205 in Italy and 35 in the United States, points to the “significant challenges” that make containing the According to the Bangladesh Bureau of Statistics, the country spread of COVID extremely difficult. 55 There are one million has one hospital bed per 1,196 people, not enough health- Rohingya refugees in Bangladesh, and health-care facilities in care equipment, and only one registered doctor for every 1,581 people. Seth Oldmixon, founder of Liberty South Asia and Photo Caption: Women collect relief items from volunteers during the an expert on Bangladesh, notes that the country’s “available nationwide lockdown as a preventive measure against the coronavirus medical facilities are not adequate to cope with a major pandemic in Dhaka, Bangladesh on May 3, 2020. (Rehman Asad/ outbreak.” Oldmixon adds that while the country has sought NurPhoto via Getty Images)

20 | HUDSON INSTITUTE refugee camps are abysmal, with no ventilators and few doctors effort to diversify its export basket by pursuing both product and healthcare workers. Oldmixon warns that these camps are and market diversification in the long run.”60 “ripe for disease outbreaks.”56 Shahab Khan, another economist at the Bangladesh Enterprise Until recently, Bangladesh was the fastest-growing economy Institute, echoes these views, noting that “the critical challenge in South Asia. Investment in human capital helped the country for the government is to diversify its export profile and focus become one of the textile manufacturing hubs of the world. The on domestic stability.” Further, according to Khan, more than global and regional economic disruptions due to COVID-19, 70 percent of Bangladesh’s labor is in informal employment, along with the return of labor from India, have caused setbacks. “extreme poverty has risen by 60 percent while poverty has increased by 54 percent, and 14 percent of people do not have The government response was to announce stimulus packages food in their home.” 61 for businesses, distribution of food to the poor, and a housing scheme for the homeless. Key among these was a stimulus Oldmixon joins others in expressing concerns about the package of $8.573 billion for the country’s critical textile and imminent economic downturn in Bangladesh. “So far, millions other export-oriented industries. The package includes a of workers in the country’s ready-made garment industry have refinance scheme operated by Bangladesh Bank that will cover been laid off, and the Asian Development Bank has warned that the salaries of workers in these industries. The World Bank has the country may see as much as $3 billion disappear from the also approved a fast-track loan of $100 million to Bangladesh national economy,” he says.62 to help deal with the impact of COVID-19.57 The government also allocated resources for health insurance for government According to Oldmixon, Prime Minister Shaikh Hasina Wajid’s employees; additional payments for health-care workers and government has been able to weather criticism over its doctors; and purchase of critical medical supplies. However, governing style in recent years “in large part because it was this has not been enough to stem the economic distress. 58 delivering both strong economic development and, along with it, a broad feeling of optimism.” If, however, Oldmixon warns, Ashikur Rahman, an economist at the Policy Research Institute “that optimism begins to wane, the government could lose this of Bangladesh, lists “higher unemployment, slowdown in poverty protection, threatening the political stability it has benefitted reduction, and higher non-performing loans in the banking from to date.”63 sector” as the short-term threats to Bangladesh’s economy. These, he says, “will weaken macroeconomic fundamentals and Open borders, migrant labor, and a strong economy have by will bring to question the overall ambition to turn Bangladesh and large kept the lid on major disruptions within Bangladeshi into an upper-middle-income country by 2030.”59 This means society. COVID has led to border closures, the return of less revenue for government through taxes, higher public debt, migrant labor from India and the Middle East, and a slowing and pressure on the balance of payments. economy, in addition to the continued crisis of Rohingya refugees. Some experts fear rising social tensions and violence Further, Bangladesh’s economy is heavily dependent on the against Rohingya refugees and the potential for religious ready-made garment industry, which contributes 86 percent of backlash against Hindus over mainly Muslim Bangladeshi its exports. Rahman suggests that “overdependence on a single migrant labor being forced out of Hindu-majority India. Public sector and weak global demand will complicate Bangladesh’s disenchantment and socio-economic distress could unite the

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA political opposition against the ruling arises to challenge the slowdown would create an opportunity for the prime minister’s Awami League. “political opponents to regroup in the short run and organize a more effective political movement in the long run.” 65 However, in Prime Minister Shaikh Hasina Wajid and her Awami League party his view it is a remote scenario, as Hasina’s personal popularity have been in power for eleven years in a relatively stable political is still quite high. system. Strong economic growth has helped the government, along with a crackdown on terrorists and good relations with India and Bangladesh have had good relations over the last India, but problems are creeping up on both these fronts. decade. In the months before Covid, the rise in anti-Muslim rhetoric and attacks on Muslims in India, the Citizenship Oldmixon points out that despite high economic growth, Amendment Bill (CAB) and the National Population Register inequality has “continued to haunt the country.” Bangladesh that target primarily Bangladeshi migrants in India’s north east, “does not have widespread social safety nets able to provide has created political tensions between both countries. All this economic and health security to the country’s vulnerable has risked fueling an anti-Indian resentment inside Bangladesh populations.” The economic downturn due to Covid will only which will not only hurt India-Bangladesh relations but also help worsen the situation.64 According to Ashikur Rahman, economic Islamist extremist groups like Jamaat e Islami.

22 | HUDSON INSTITUTE NEPAL

Nepal imposed a countrywide lockdown on March 24, 2020, and material to all areas and its failure to “mobilize private and by May 21, had fewer than 427 confirmed cases, and no hospitals and medical persons to fight against COVID-19.”68 deaths have been reported.66 The government, like its South Asian neighbors, also banned domestic and international flights Rohit Karki of the Geneva Centre for Security Sector Governance and closed all non-essential businesses.67 Its response has praises the Nepali government’s quarantine measures and primarily focused on increasing spending on medical personnel, facilities and the “well-established single mechanism to importing medical supplies, and setting up quarantine centers coordinate multisectoral responses.” However, Karki, like and makeshift hospitals. India has aided Nepal and the Maldives Khanal, points out the government’s inability to acquire enough by helping set up shelters and providing technical training. mass-testing equipment, its insufficient contact tracing, and the “substandard and expensive medical supplies related Prem Khanal, professor at Kathmandu’s Tribhuvan University, to COVID-19 from China.”69 According to Apeyksha Shah, believes that the government’s response has overall been professor at Tribhuvan University, while the lockdown was a positive but that more needs to be done. In his opinion, Nepal needs more laboratories for testing, particularly in “high-risk Photo Caption: A Nepalese monk carries a statue of Buddha around areas, especially western Nepal and the Tarai district” bordering Boudhanath Stupa, a UNESCO World Heritage Site during the China and India. The challenge facing the government, Khanal celebration of the Buddha Purnima festival in Kathmandu, Nepal on believes, is the difficulty in providing enough medical equipment May 7, 2020. (Narayan Maharjan/NurPhoto via Getty Images)

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA good move, it also “exposes poor planning.” Shah refers to the internal fault lines, Karki asserts, could be exacerbated by problems faced by both the domestic poor migrant labor as well developments in Nepal’s largest neighbor, India. The rise of as the thousands of Nepalis working in India who were unable Hindu majoritarianism in India, Karki notes, has “given impetus to return to their homes.70 to the possibility of reinstating the monarchy in Nepal, thus undermining the gains of the past twelve years.”73 Further, experts expressed concerns about lack of government transparency and corruption, especially in the purchase of Karki also expresses concerns about the potential for “a political medical supplies. According to Karki and Shah, the public power struggle” within the ruling Nepal Communist Party that has misgivings about the government’s “commitment and may threaten Nepal’s three-decade-old democracy. This, he effectiveness.” Here they were referring to the reports of notes, would undermine the nascent “human rights, rule of law, corruption faced by the government task force. 71 As a result, and oversight mechanisms.” 74 the experts note, the work was initially handed over to the Nepali Army and then finally to private companies. Khanal sees a rise in public distrust and disenchantment because of the government’s failure to manage the COVID-19 Nepal’s health-care infrastructure is in a poor state, and a large crisis properly. He notes that in addition to the abysmal health- migrant population is more vulnerable to infectious diseases. care infrastructure—a lack of hospital beds, medical equipment, Karki argues for strengthening the public health-care systems. and health-care personnel— “people are not happy with the government.” 75 He notes that privatization is not the cure. Instead, what the government needs to do is “devise a policy to better coordinate Nepal’s economy is dependent on migrant laborers (who work its efforts regarding reduction of cross-border spread of the in other countries, primarily India) and tourism. The COVID-19 virus as Nepali migrant workers come in through the borders.” 72 pandemic has hurt both these key sectors. When experts were asked their views on COVID-19’s impact on Nepal’s economy, Since 2008, with the abolition of the monarchy, Nepal has Khanal stated that the “short-term effect in economic sectors is attempted to build a stable political and social system. This has that people have lost their jobs, industries are shutting down, been challenged, not only by the India-China rivalry and natural tourist industries are suffering.” 76 Nepal’s economy will also be disasters, but also by the Madhesi issue, the issue of refugees hurt by the decline in remittances from Nepalis who work in the (from Bhutan, Tibet, and Sikkim), and the reluctance of the Middle East. According to the World Bank, Nepal’s economic Maoists to fully integrate within the existing system. growth is “expected to fall to a range between 1.5 and 2.8 percent in FY20 reflecting lower remittances, trade and tourism.” When experts were asked their views on the COVID pandemic’s 77 The Nepali government cancelled its “Visit Nepal Year 2020” expected impact on the short- and long-term fault lines that campaign and postponed its inaugural “Sagarmatha Sambaad” plague Nepal, Rohit Karki mentioned several issues: a rise in due to COVID-19.78 authoritarianism, threats to federalism—from Kathmandu’s increased power over the provincial governments—and On the geopolitical front, Karki points out that “the contending the potential for ethnic conflict if there is no resolution of the initiatives of China’s BRI and the US Indo-Pacific strategy will decades-old issue of Madhesis and other ethnic groups have implications for Nepal’s foreign policy choices.” 79 Thus, he seeking accommodation within the Nepali constitution. These believes that COVID-19 will once again cause an “India-China

24 | HUDSON INSTITUTE geopolitical rivalry,” with each country vying to give aid to Nepal sector have provided the mountainous country with medical in an effort to expand strategic influence. Khanal, however, equipment and material. 80 This is interesting, as Nepal’s Health differs, arguing that COVID-19 will increase China’s leverage Ministry believes that most of the China-supplied COVID-19 over Nepal because both Beijing and the Chinese private rapid diagnostic kits are unreliable.81

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA SRI LANKA

As of May 21, 2020, Sri Lanka had 1028 confirmed cases Sri Lanka, despite one of the highest scores on human capital with only 9 deaths.82 The government closed all non-essential and a critical geostrategic location in the Indian Ocean region, businesses on March 16, suspended international flights and was hurting economically well before the COVID-19 pandemic shipping, and imposed a nation-wide lockdown on March 20.83 hit. Its economy, according to the World Bank, was growing at three percent - the lowest growth rate in South Asia.85 In addition, Ranga Jayasuriya, senior fellow at the Institute of National Sri Lanka is highly indebted, and China is a major creditor. Security Studies Sri Lanka, credits the relatively low number of cases in the island nation to decisive and drastic government “Colombo has to pay US $4.8 billion as external debt servicing action and to Sri Lanka’s contact tracing system. He argues that for this year, the largest debt repayment in the country’s history,” the main long-term challenge the country faces is “to manage adequate mitigation measures” to prevent a return of the virus, Photo Caption: Sri Lankan Air Force officers use a disinfectant spray and notes that “an aggressive testing strategy is important to at the Fort Railway Station in Colombo, Sri Lanka on March 18, 2020. keep tabs on the virus.”84 (Tharaka Basnayaka/NurPhoto via Getty Images)

26 | HUDSON INSTITUTE notes Jayasuriya. 86 Of the $72 billion public debt, equivalent sovereign default.” 92 “Some of the maturities are already trading to 82 per cent of GDP, $35 billion is external loans. Moreover, at huge discounts [even though] the Central Bank has pledged the country’s economy is dependent on garment manufacture to maintain the country’s zero default record.” According to for export, tourism, and remittances from workers abroad. Abeyagoonasekera, Sri Lanka’s challenge will be “to navigate The tourism industry—already hit by the 2019 Easter Sunday the harsh external shocks of a deep global recession.” 93 attacks—has been hit again by the pandemic. The garment industry is suffering, and so are remittances, as in Bangladesh. None of this is without political consequences. President Gotabaya Rajapaksa dissolved parliament on March 1, triggering The government’s response has been to allocate up to 0.1 fresh legislative elections, but they cannot be held in time and percent of GDP for quarantine and other containment measures, have been postponed indefinitely by the Election Commission. as well as $5 million (0.01 percent of GDP) to the SAARC Jayasuriya, warned against the “temptation to politicize the COVID-19 Emergency Fund. The government has announced initial success of its COVID-19 response,” noting that “the tax relief and exemptions and has set up special funds to provide key personalities of the current government have a history” of relief to the poor and unemployed.87 The government took out playing politics at the expense of good governance.”94 a ten-year, $100 million loan from China Development Bank to help it get through the crisis.88 Asanga Abeyagoonasekera, The absence of parliament could lead to problems, especially former director general of the National Security Think Tank of Sri if the president tries to govern the country with a caretaker Lanka, believes that this loan will only lead Sri Lanka into a cycle government. “This would trigger a constitutional crisis and of recurrent loans from China to deal with “unavoidable external most likely street protests—not a situation in anyone’s interest,” shocks from the global recession.”89 observes Jayasuriya. 95 According to Abeyagoonasekera, “In a multiparty democracy, horizontal power is essential Sri Lanka’s immediate challenge is to figure out how to service for discussing, debating, and minimizing errors made by its loans. Historically speaking, Jayasuriya notes, Sri Lankan the vertical power axis, the executive. Parliament would governments simply took out new loans to repay old ones. have assisted the executive to look at multiple proposals; However, he says, that means there is “little investor appetite unfortunately, this is absent.”96 to buy government bonds.” 90 Thus, when the government auctioned development bonds in March 2020, only $22 million Pandemics often exacerbate social divisions and divides. Ever in bids was received for $220 million of securities on sale, since the 1960s, the Tamil question has created instability within according to the Central Bank.91 The Sri Lankan government the Sri Lankan polity and society. The country has been ravaged might be forced to use its foreign reserves, which stand at $7.5 by riots and a long civil war. The long-term viability of the island billion, but these are enough for only four-and-a-half months of nation, most experts agree, depends on a policy of social and imports. According to Jayasuriya, even before COVID-19, Sri political integration of all its ethnic groups. Lanka had been lobbying for a three-year debt moratorium and had approached India with that request. Jayasuriya notes that historically speaking, Sri Lankan governments have “lacked political will either to address the The lion’s share of Sri Lanka’s external debt is in the form of reasonable political aspiration of Tamils or adequately fight off sovereign bonds. Talk of a debt moratorium, Jayasuriya points and militarily defeat the national security threat posed by the out, creates “concerns that the country is heading towards a militant, and later, the terrorist manifestation of Tamil separatism.”

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA The 2009 military defeat of the LTTE, the Liberation Tigers of The second strategy, Jayasuriya says, is to build a “society Tamil Eelam, provided the state with “an opening for a political based on the rule of law, individual rights, and economic solution,” but according to Jayasuriya, with no military threat justice.” This would “weaken the demands for ethnic-based on the horizon, political leaders “lost the sense of urgency to devolution” and would gain support from the Sinhala majority. address the problem.” 97 However, he warns that “given the dynamics of Sri Lankan politics,” such initiatives may have the opposite impact and Going forward, Jayasuriya advocates two strategies “to foster “lead to polarization along ethnic lines.”99 political and social integration of all [Sri Lanka’s] communities. The first—which has hitherto been tried and is also the most Abeyagoonasekera, however, argues for restarting the existing divisive—is the devolution of power to minority-majority national reconciliation process rather than reinventing the provinces.” 98He contends that the Tamil political demand for wheel. 100 Most Sri Lanka experts predicted a bumpy road a model based on ethnic federalism may not be realistic, but ahead in both Tamil-Sinhala relations and in economic revival in devolution of power and full implementation of the thirteenth the aftermath of the coronavirus. amendment to the constitution might be effective.

28 | HUDSON INSTITUTE CONCLUSION

The coronavirus pandemic threatens not only lives and strengthen its position in the Indian Ocean by deepening ties livelihoods in South Asia; it could also be the precursor of with Pakistan and Sri Lanka. significant political and strategic shifts in the region. The Bangladeshi and Indian economies will survive the devastation, India’s initiative to develop a regional response to the threat but their governments will have to restore growth by protecting posed by COVID-19 has been undermined by Pakistan’s and encouraging investment. Pakistan and Sri Lanka will likely insistence on raising the Kashmir issue even in this challenging move in the direction of negative growth and will need debt relief time. Since then, India and Pakistan have exchanged fire along from their international creditors. Without it, Sri Lanka faces the the LOC in Kashmir, affirming the view that conflict between the prospect of a sovereign debt default. Both countries are likely to two nuclear-armed neighbors will worsen, rather than diminish, look to China as their benefactor, as their leaders have tended in the post-coronavirus era. to do for a while. Given that Pakistan has fewer resources to further its military buildup China will most likely press its advantage by bailing out South against India, it is likely to escalate the use of subconventional Asia’s indebted governments, in exchange for its pound of flesh. This would come at the expense of India’s security and Photo Caption: Indian health officials inside a COVID-19 mobile testing US influence in the region. India and the United States must van wait to collect samples from people on April 30, 2020 in New develop a plan to counter efforts China will likely make to Delhi, India. (Yawar Nazir/Getty Images)

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA warfare (terrorism) in an effort to gain the upper hand against take place when the pandemic has died down. India could, and much-larger India. Pakistan might seek relief from terrorism- probably will, try to work with other countries in the region, but related strictures on grounds that it needs space to deal with the not Pakistan. coronavirus emergency. International pressure, especially FATF gray-list sanctions targeting Pakistan, might be needed to restrain In Afghanistan, the environment created by the pandemic is the worst anti-Indian impulses of its civil and military leaders. threatening the US-initiated peace process. The Taliban has stepped up attacks to maximize its military advantage, in In the past, Pakistan has used natural disasters to expand violation of its Doha agreement with the United States. Human terrorist infiltrations into Kashmir and India. Indian officials life matters little to the Taliban, and it seems prepared to put are concerned that Pakistan could use the COVID crisis as a the lives of its fighters and the general public at risk by violating distraction to do the same. The episodic firing by both sides coronavirus restrictions. along the LOC reflects India’s effort to block infiltration and Pakistan’s artillery providing cover to infiltrators, even though So far, US policy seems focused on encouraging the Afghan Pakistan claims it is not allowing infiltration. government and other anti-Taliban groups to resolve their political disputes and begin negotiations with the Taliban Although a full-blown war in the subcontinent is unlikely, tensions on Afghanistan’s future. Washington should now consider between India and Pakistan will probably continue to impede threatening the Taliban with consequences for violating its efforts for regional cooperation. Such cooperation could ease promise to reduce violence but should also help the government the task of economic reconstruction that will almost certainly to address the threat posed by COVID-19.

30 | HUDSON INSTITUTE ENDNOTES

1 “World Economic Outlook, April 2020: The Great Lockdown,” 16 “Policy Responses to COVID-19: India,” International Monetary International Monetary Fund, April 2020, https://www.imf.org/en/ Fund, https://www.imf.org/en/Topics/imf-and-covid19/Policy-Re- Publications/WEO/Issues/2020/04/14/weo-april-2020. sponses-to-COVID-19#I.

2 Indian Council of Medical Research website, https://icmr.nic.in/ 17 “Narendra Modi Says Total Virus-Related Economic Package Will content/covid-19. Be Worth Rs 20 Lakh Crore,” Bloomberg, May 12, 2020 https:// www.bloombergquint.com/coronavirus-outbreak/pm-modi-live- 3 “COVID-19 Coronavirus Tracker,” KFF, https://www.kff.org/glob- narendra-modi-to-address-the-nation-on-covid-19-lockdown-sit- al-health-policy/fact-sheet/coronavirus-tracker/. uation-at-8-pm

4 Email interview with Manoj Joshi, April 2020 18 “India to plan tax holiday to win new investments,” Times of India, May 12, 2020, http://timesofindia.indiatimes.com/article- 5 “Covid-19: PM Modi Indicates Lockdown Will Be Extended as show/75692396.cms?utm_source=contentofinterest&utm_medi- India Breaches Daily Record of Deaths,” India Today, April 28, um=text&utm_campaign=cppst 2020, https://www.indiatoday.in/india/story/covid-19-pm-modi- indicates-lockdown-will-be-extended-as-india-breaches-daily-re- 19 Surojit Gupta, “Three states ease labor laws to boost investment, cord-of-deaths-1671838-2020-04-28. jobs,” Times of India, May 9, 2020

6 ‘Vande Bharat Mission: By air & sea, India’s evacuation operation 20 Jeffrey Gettleman, Suhasini Raj, and Sameer Yasir, “New Delhi picks up pace,’ Times of India, May 9, 2020 https://timesofindia. Streets Turn into Battleground, Hindus vs. Muslims,” New York indiatimes.com/business/india-business/vande-bharat-mission- Times, February 25, 2020, https://www.nytimes.com/2020/02/25/ by-air-sea-indias-evacuation-operation-picks-up-pace/article- world/asia/new-delhi-hindu-muslim-violence.html. show/75637242.cms 21 “Tablighi Jamaat: The Group Blamed for New COVID-19 Out- 7 Niha Masih, “Aggressive Testing, Contact Tracing, Cooked Meals: break in India,” BBC News, April 2, 2020, https://www.bbc. How the Indian State of Kerala Flattened Its Coronavirus Curve,” com/news/world-asia-india-52131338.; Hannah Ellis-Peterson Washington Post, April 13, 2020, https://www.washingtonpost. and Shaikh Azizur Rahman, “Coronavirus conspiracy theories com/world/aggressive-testing-contact-tracing-cooked-meals- targeting Muslims spread in India,” The Guardian, April 13, 2020 how-the-indian-state-of-kerala-flattened-its-coronavirus-cur- https://www.theguardian.com/world/2020/apr/13/coronavi- ve/2020/04/10/3352e470-783e-11ea-a311-adb1344719a9_sto- rus-conspiracy-theories-targeting-muslims-spread-in-india ry.html. 22 Email interview with Manoj Joshi, April 2020 8 Email interview with Christophe Jaffrelot, April 2020 23 Email interview with Christophe Jaffrelot, April 2020 9 Himani Chanda, “At 1.28% of GDP, India’s Expenditure on Health Is still Low although Higher than Before,” The Print, October 31, 24 Elizabeth Roche, “India Says It’s ‘Encouraging’ That SAARC 2019, https://theprint.in/health/at-1-28-gdp-india-expenditure- Leaders Contributed to COVID-19 Emergency Fund,” LiveMint, on-health-still-low-although-higher-than-before/313702/. March 23, 2020, https://www.livemint.com/news/india/india- says-it-s-encouraging-that-saarc-leaders-contributed-to-covid- 10 “World Economic Outlook, April 2020: The Great Lockdown,” 19-emergency-fund-11584982675012.html. International Monetary Fund, April 2020, https://www.imf.org/en/ Publications/WEO/Issues/2020/04/14/weo-april-2020. 25 Mandira Nayar, “COVID-19: After Modi’s SAARC Initiative, Nepal, Maldives Reach Out to India for Help,’ The Week, March 19, 11 Email interview with Rupa Subramanya, April 2020 2020, https://www.theweek.in/news/india/2020/03/19/covid-19- after-modis-saarc-initiative-nepal-maldives-reach-out-to-india-for- 12 Email interview with Nitin Pai, April 2020 help.html.

13 Anjana Pasricha, “Indian Migrant Workers Trudge Hundreds of 26 Anju Ranganathan, “India’s Drugmakers Ramp Up Production Kilometers for COVID-19 Lockdowns,” VOA News, March 28, Of ‘Game-Changer’ Coronavirus Drug Hydroxychloroquine,” 2020, https://www.voanews.com/south-central-asia/indian-mi- Forbes, April 9, 2020, https://www.forbes.com/sites/anu- grant-workers-trudge-hundreds-kilometers-covid-19-lockdowns. raghunathan/2020/04/09/indias-drugmakers-ramp-up-pro- duction-of-game-changer-coronavirus-drug-hydroxychloro- 14 Email interview with Rupa Subramanya, April 2020 quine/#58427fd05d5a.

15 Amartya Sen, Raghuram Rajan, and Abhijit Banerjee, ‘‘Huge 27 Email interview with Vice Admiral (retd) Shekhar Sinha Numbers May Be Pushed into Dire Poverty or Starvation…We Need To Secure Them,” Indian Express, April 17, 2020, https:// 28 Email interview with Jayadeva Ranade, April 2020 indianexpress.com/article/opinion/coronavirus-india-lock- down-economy-amartya-sen-raghuram-rajan-abhijit-baner- 29 “COVID-19 Coronavirus Tracker,” KFF, https://www.kff.org/glob- jee-6364521/. al-health-policy/fact-sheet/coronavirus-tracker/.

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA 30 Diaa Hadid, “Pakistani Students in Wuhan Say Pakistan Won’t 46 Email interview with Davood Moradian, April 2020 Evacuate Them for Political Reasons,” NPR, February 16, 2020, https://www.npr.org/2020/02/16/806417296/pakistani-stu- 47 Email interview with Javid Ahmad, April 2020 dents-in-wuhan-say-pakistan-wont-evacuate-them-for-politi- cal-reason. 48 Email interview with Davood Moradian, April 2020

31 “Pakistan Extends Coronavirus Lockdown, Some Industries 49 Email interview with Prakhar Sharma, April 2020 to Reopen in Phases,” Reuters, April 14, 2020, https://www. reuters.com/article/us-health-coronavirus-pakistan-khan/pa- 50 Email interview with Davood Moradian, April 2020 kistan-extends-coronavirus-lockdown-some-industries-to-re- open-in-phases-idUSKCN21W1P8. 51 Email interview with Davood Moradian, April 2020

32 “Pakistan Quarantines 20,000 following Tabligh Gathering in 52 Email interview with Javid Ahmad, April 2020 Lahore,” Al Jazeera, April 6, 2020, https://www.aljazeera.com/ news/2020/04/pakistan-quarantines-20000-tabligh-gathering-la- 53 “COVID-19 Coronavirus Tracker,” KFF, https://www.kff.org/glob- hore-200406075221220.html. al-health-policy/fact-sheet/coronavirus-tracker/.

33 Email interview with Dr Mohammad Taqi, April 2020 54 Email interview with Seth Oldmixon, April 2020

34 Email interview with Farahnaz Ispahani, April 2020 55 Email interview with Seth Oldmixon, April 2020

35 “World Economic Outlook, April 2020: The Great Lockdown,” 56 Email interview with Seth Oldmixon, April 2020 International Monetary Fund, April 2020, https://www.imf.org/en/ Publications/WEO/Issues/2020/04/14/weo-april-2020. 57 “World Bank Fast-Tracks $100 Million COVID-19 (Corona- virus) Support for Bangladesh,” World Bank Press Release, 36 “Policy Responses to COVID-19: Pakistan,” International Mone- April 3, 2020, https://www.worldbank.org/en/news/press-re- tary Fund, https://www.imf.org/en/Topics/imf-and-covid19/Poli- lease/2020/04/03/world-bank-fast-tracks-100-million-covid-19- cy-Responses-to-COVID-19#I. coronavirus-support-for-bangladesh.

37 “Pakistan,” International Monetary Fund, https://www.imf.org/en/ 58 “World Economic Outlook, April 2020: “The Great Lockdown,” In- Countries/PAK. ternational Monetary Fund, https://www.imf.org/en/Publications/ WEO/Issues/2020/04/14/weo-april-2020. 38 “IMF Executive Board Approves a US$1.386 Billion Disbursement to Pakistan to Address the COVID-19 Pandemic,” IMF Press Re- 59 Email interview with Ashikur Rahman, April 2020 lease No. 20/167, April 16, 2020, https://www.imf.org/en/News/ Articles/2020/04/16/pr20167-pakistan-imf-executive-board-ap- 60 Email interview with Ashikur Rahman, April 2020 proves-disbursement-to-address-covid-19. 61 Email interview with Shahab Khan, April 2020 39 Email interview with Uzair Younus, April 2020 62 Email interview with Seth Oldmixon, April 2020 40 Hugh Tomlinson, “Pakistan Cuts Thousands from Terrorist Watch 63 Email interview with Seth Oldmixon, April 2020 List,” Times (UK), April 22, 2020, https://www.thetimes.co.uk/arti- cle/pakistan-cuts-thousands-from-terrorist-watch-list-mjxc8vfg8. 64 Email interview with Seth Oldmixon, April 2020 41 Email interview with Ayesha Siddiqa, April 2020 65 Email interview with Ashikur Rahman, April 2020 42 Atta-ur-Rahman, “Pandemic Science,” The News (Pakistan), April 66 “COVID-19 Coronavirus Tracker,” KFF, https://www.kff.org/glob- 1, 2020, https://www.thenews.com.pk/print/637478-pandem- al-health-policy/fact-sheet/coronavirus-tracker/. ic-science. 67 Brabim Karki, “Nepal Extends Ongoing Lockdown to Combat 43 “COVID-19 Coronavirus Tracker,” KFF, https://www.kff.org/glob- COVID–19,” Diplomat, April 7, 2020, https://thediplomat.com/ al-health-policy/fact-sheet/coronavirus-tracker/. tag/nepal-and-covid-19/. 44 Fatima Faizi and David Zucchino, “Fresh from Iran’s Coronavirus 68 Email interview with Prem Khanal, April 2020 Zone, Now Moving across Afghanistan,” New York Times, April 13, 2020, https://www.nytimes.com/2020/03/26/world/asia/af- 69 Email interview with Rohit Karki, April 2020 ghanistan-iran-coronavirus.html. 70 Email interview with Apeyksha Shah, April 2020 45 Email interview with Davood Moradian, April 2020

32 | HUDSON INSTITUTE 71 Email interview with Rohit Karki, April 2020 87 “Policy Responses to COVID-19: India,” International Monetary Fund, https://www.imf.org/en/Topics/imf-and-covid19/Policy-Re- 72 Email interview with Rohit Karki, April 2020 sponses-to-COVID-19#I.

73 Email interview with Rohit Karki, April 2020 88 “Sri Lanka and China Development Bank Sign $500 m Funding Deal,” Colombo Gazette, March 18, 2020, https://colomboga- 74 Email interview with Rohit Karki, April 2020 zette.com/2020/03/18/sri-lanka-and-china-development-bank- sign-500-m-funding-deal/. 75 Email interview with Prem Khanal, April 2020 89 Email interview with Asanga Abeyagoonasekera, April 2020 76 Email interview with Prem Khanal, April 2020 90 Email interview with Ranga Jayasuriya, April 2020 77 “World Economic Outlook, April 2020: The Great Lockdown,” International Monetary Fund, April 2020, https://www.imf.org/en/ 91 “Sri Lanka Development Bonds Issue for US$220 mn Undersub- Publications/WEO/Issues/2020/04/14/weo-april-2020. scribed,” Colombo Page, March 31, 2020, http://www.colom- bopage.com/archive_20A/Mar31_1585636860CH.php. 78 This is a multi-stakeholder, permanent global dialogue forum initiated by the government of Nepal. The first dialogue was 92 Email interview with Ranga Jayasuriya, April 2020 scheduled for April 2020. See https://sagarmathasambaad.org/. 93 Email interview with Asanga Abeyagoonasekera, April 2020 79 Email interview with Rohit Karki, April 2020 94 Email interview with Ranga Jayasuriya, April 2020 80 Email interview with Prem Khanal, April 2020 95 Email interview with Ranga Jayasuriya, April 2020 81 Ramu Sapkota, “Nepal to Test COVID-19 Test Kits from China,” Nepal Times, April 1, 2020, https://www.nepalitimes.com/latest/ 96 Email interview with Asanga Abeyagoonasekera, April 2020 nepal-to-test-covid-19-test-kits-from-china/. 97 Email interview with Ranga Jayasuriya, April 2020 82 “COVID-19 Coronavirus Tracker,” KFF, https://www.kff.org/glob- al-health-policy/fact-sheet/coronavirus-tracker/. 98 Email interview with Ranga Jayasuriya, April 2020

83 “Sri Lanka Extends Coronavirus Lockdown,” AFP, April 26, 99 Email interview with Ranga Jayasuriya, April 2020 2020, https://www.deccanherald.com/international/sri-lanka-ex- tends-coronavirus-lockdown-for-another-week-830294.html. 100 Email interview with Asanga Abeyagoonasekera, April 2020

84 Email interview with Ranga Jayasuriya, April 2020

85 “World Economic Outlook, April 2020: The Great Lockdown,” International Monetary Fund, April 2020, https://www.imf.org/en/ Publications/WEO/Issues/2020/04/14/weo-april-2020.

86 Email interview with Ranga Jayasuriya, April 2020

CRISIS FROM KOLKATA TO KABUL: COVID-19’S IMPACT ON SOUTH ASIA Hudson Institute 1201 Pennsylvania Avenue, Fourth Floor, Washington, D.C. 20004 +1.202.974.2400 www.hudson.org